The Commission confirmed that not including spending limits in the new Slovak budget would reverse the already completed first milestone of the national recovery plan and would have reputational and financial consequences.
In the budget proposal, there is only a vague mention of the spending limits, which are required according to the National Recovery and Resilience plan. This mention says there is an “agreement missing of how spending limits would be calculated”.
Spending limits were part of the first milestone of the recovery plan and were checked as done after parliament approved the base ground law needed for their inclusion in the budget. However, the Commission informed the Finance Ministry, that this is not enough and if they are not part of the budget, it can’t approve any further money.
“The European Commission has informed the Slovak side that the approval of the 2023 public administration budget without spending limits will represent a reversal of the milestone that was positively assessed in the first payment request,” the Commission said in a statement for Denník N daily.
Spending limits were vetoed at the coalition meeting by Employment Minister Milan Krajniak.
“The Fiscal Responsibility Council (FRC) and the European Commission (EC) are telling me to cut €500 million from next year’s budget for social spending. I will not do that. To cut child benefits or support for pensioners? I will not do it,” Krajniak said at a press briefing, adding that “we will have to negotiate with the Commission”.
It remains unclear what would happen were the National Council to pass the budget without spending limits.
“As there is no precedent at the European level for reversing the milestone, the Slovak Republic would be the first EU member state to face this process,” the recovery fund department at the government’s office has said.
(Michal Hudec | EURACTIV.sk)
Source: euractiv.com
